Infrared Environmental Infrastructure Gp Limited v. Kingdom of Spain, Civil Action No. 2020-0817

Background

Plaintiffs are U.K.-organized investors who invested ~$31 million in Spanish solar projects and initiated ICSID arbitration under Article 26 of the Energy Charter Treaty (ECT); an ICSID tribunal awarded them >$30 million plus interest, costs, and fees in August 2019.
Spain applied to an ICSID ad hoc Annulment Committee under Article 52 (Dec. 2019), arguing the award is void because EU law (per CJEU’s Achmea decision) precludes an EU member state from consenting to arbitration with another EU investor; ICSID provisionally stayed enforcement and later conditioned the lifting of that stay on plaintiffs’ undertakings not to use or transfer collected funds.
Plaintiffs filed suit in the U.S. District Court for the District of Columbia to enforce the ICSID award (March 25, 2020), relying on the U.S. implementing statute for Article 54 of the ICSID Convention (22 U.S.C. § 1650a) and the FSIA arbitration exception.
Spain moved to dismiss (or, alternatively, for a stay), principally arguing that Achmea and EU law negate Spain’s consent to arbitrate under the ECT, eliminating ICSID jurisdiction and this Court’s subject-matter jurisdiction. The European Commission filed an amicus brief supporting Spain.
The district court declined to decide the merits of the jurisdictional/EU-law conflict, denied Spain’s dismissal motion and plaintiffs’ summary-judgment motion without prejudice, and granted Spain’s request to stay enforcement proceedings pending the ICSID Annulment Committee’s decision; the court also refused to condition the stay on Spain posting a bond.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Spain validly consented to ICSID arbitration under the ECT in light of CJEU Achmea	ECT Article 26 and ICSID Convention supply written consent; ICSID award is final and enforceable	Achmea holds EU law precludes intra‑EU arbitration that may implicate EU law, so Spain’s offer to arbitrate was void ab initio	Court did not resolve the conflict; denied dismissal without prejudice and stayed the case pending ICSID annulment proceedings
Whether U.S. courts have subject‑matter jurisdiction to enforce the award while annulment is pending	22 U.S.C. §1650a and FSIA §1605(a)(6) create jurisdiction to enforce ICSID awards	If there was no agreement to arbitrate (per Achmea), the FSIA arbitration exception does not apply and U.S. courts lack jurisdiction	Court declined to decide jurisdictional question now; stayed proceedings instead
Whether the District Court should stay enforcement proceedings pending the ICSID Annulment Committee decision	Plaintiffs: Annulment Committee lifted its provisional stay and plaintiffs gave undertakings, so enforcement here should proceed	Spain: parallel annulment raises risk of inconsistent rulings, comity and judicial economy favor a stay	Court granted a stay, finding judicial economy and comity, and risk of conflicting judgments outweigh plaintiffs’ interests
Whether Spain must post a bond/security as condition of the stay	Plaintiffs requested a bond to secure potential recovery if award is annulled	Spain opposed; court lacks authority (and would assume award validity) to require bond under ICSID scheme	Court refused to condition stay on Spain posting a bond

Key Cases Cited

Arbaugh v. Y & H Corp., 546 U.S. 500 (2006) (courts must ensure subject‑matter jurisdiction before reaching merits)
Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp., 549 U.S. 422 (2007) (courts may address non‑merits threshold issues before jurisdiction)
Landis v. North American Co., 299 U.S. 248 (1936) (district court’s discretionary stay authority)
Pub. Citizen v. U.S. Dist. Court for the Dist. of Columbia, 486 F.3d 1342 (D.C. Cir. 2007) (courts may address threshold non‑jurisdictional issues)
Belize Soc. Dev. Ltd. v. Gov’t of Belize, 668 F.3d 724 (D.C. Cir. 2012) (stay analysis balancing interests)
Masdar Solar & Wind Cooperatief U.A. v. Kingdom of Spain, 397 F. Supp. 3d 34 (D.D.C. 2019) (staying enforcement pending related ICSID proceedings)
Philipp v. Fed. Republic of Germany, 253 F. Supp. 3d 84 (D.D.C. 2017) (stay burden and hardship standard)